When I go through the estate planning questionnaire with a client I suggest they think long and hard before selecting their trustee. In fact, if they hesitate for a split second when naming someone I ask about it. For example, they might say, “well our son is probably our first choice… well… ahhh….” The second I heard the word “probably” I was wondering what that was about. I know it does not mean their son is dishonest but maybe he has an overbearing wife? Or maybe he and his brother don’t get along. Or who knows!? The point is there is a reason they said “probably.” I thus bring you 10 characteristics to look for in your chosen trustees in no particular order:
- General competence
- Financial experience
- Life experience
- Ability to see things fr
Not all trustees are independent and not all trustees are special… but the terms “independent trustee” and “special trustee” have the same meaning in estate planning. They are an unrelated and economically disinterested person with limited authority in a trust. Not all trusts will have such a trustee as the vast majority of trusts just have a standard trustee. However, in some situations this special trustee is advisable.
In one of the trusts the term is defined as:
An Independent Trusteeor Special Trustee shall mean a Trustee who is neither a Beneficiary of any trust established under this instrument nor a person who has transferred or joined in the transfer of property to the trust estate. If a General Power of Appointment held by a Beneficiary of a
There are many instances where a California trust ends up without a trustee in charge. When I do estate planning I try to come up with a number of back-up choices and thus this doesn’t happen for clients when I do the estate plan. However, not everybody comes to me for their planning. Some only come to clean up messes created elsewhere. The lack of a trustee is one of those messes. There are many reasons a trust can be without a trustee. Among those:
A person has died;
A person is sick or unable to act;
A person doesn’t want to act as trustee;
Any of 100 other reasons….
So, let’s say mom has died and has a trust that names daughter #1 as trustee and no back up. I have met with clients like that. I advise them to put in a back up and they say they don’t need to because
Who do you TRUST to be your trustee? Trust is in all caps for a reason… the person, or company, you select as trustee of your trust better be REALLY TRUSTWORTHY. They will control your assets when you die of course… but also, generally, when you are incapacitated. Yes, they will have your bank accounts, stock accounts, bonds, real estate and all other assets in THEIR CONTROL. So I ask again, who do you TRUST to be your trustee? There are many options for who can serve as a trustee. Here are some common possibilities to consider, in no particular order:
- HIGHLY trustworthy family or friend;
- Private professional fiduciary (pfac-pro.org);
- Banks or corporate trustees;
- CPAs, attorneys or other professionals.
There are probably other options but these are the most common.